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Is UK Offshore Wind Subsidy Free?

Updated: Jan 27, 2020

On the 8th of November, Winds of Change hosted a discussion delivered by Everoze’s, Lyle Honeyman, on the price of offshore wind energy in the UK. Why is it getting cheaper? Is offshore wind subsidy free and are we on the way there?


UK offshore wind prices, measured in terms of lifetime costs of electricity generation, have dropped significantly from £167/ MWh to £127/ MWh between 2017 and 2019. These costs are projected to drop further to approximately £40/MWh by the year 2024 according to contracts for difference (CfD) trends.


The main factors impacting the cost of offshore wind energy are construction and operating costs, energy yield and cost of finance.

So, what exactly is a subsidy?


The WTO defines a subsidy as “a government revenue that is otherwise due, foregone or not collected such as reduced tax rates.”


What does this mean for offshore wind energy?


A subsidy-free offshore wind scheme would allow offshore wind to become a major player in the energy generation and it would mean cheaper electricity for you! But is it too good to be true?


Read more about whether subsidy free offshore wind is actually feasible and whether the numbers around it are accurate in the presentation attached!




By Anushka Kapoor

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